5) Which of the following inventory costing methods uses the cost of the oldest purchases to calculate the cost of goods sold? A) Specific identification B) Weighted average C) Last-in, first-out D) First-in, first-out *) When a company is using the direct write-off method, and an account is written off the journal entry consists of a: A) credit Accounts Receivable and a debit to Interest Expense. B) credit to Accounts Receivable and a debit to Bad Debts Expense. C) debit to the Allowance for Bad Debts and a credit to Accounts Receivable. D) debit to Accounts Receivable and a credit to Cash. *7) Which of the following would be included in the journal to record an NSF check? A) a debit to Bank Expense and a credit to Cash B) a debit to Accounts Receivable and a credit to Cash C) a debit to Accounts Payable and a credit to Cash D) a debit to Cash and a credit to Accounts Receivable ** 8) Calculate the interest on a 90-day,9% note for $36,000. (Use a 360-day year to compute interest.) A) $460 B) $720 C) $810 D) $880 . B) $62 . ** A company has a petty cash fund amount of $300. When replenished, it has petty cash receipts of $30 for gas expense, $32 for postage expense, $16 for supplies expense and $10 for miscellaneous expenses. Assume the cash balance is not over or short. In the journal entry, Cash would be credited with: A) $72 878 D) $88 1) Which of the following is the correct formula to calculate inventory turnover? A) Inventory turnover = Cost of goods sold + Average merchandise inventory B) Inventory tumover - Cost of goods sold + Average merchandise inventory Inventory turnover = Cost of goods sold * Average merchandise inventory D) Inventory turnover - Cost of goods sold - Average merchandise inventory * L) Which of the following principles states that a business's financial statements must report enough information for outsiders to make knowledgeable decisions about the company? A) materiality concept B) consistency principle C) accounting conservatism D) disclosure principle * LZ) GAAP requires most companies to use the A) 360-day method to evaluate bad debts. B) amortization method to evaluate bad debts. allowance method to evaluate bad debts. D) direct write-off method to evaluate bad debts. 3) A company using the perpetual inventory system purchased inventory worth $25,000 on account with terms of 2/10, 1/30. Defective inventory of $2,000 was returned 2 days later and the accounts were appropriately adjusted. If the invoice is paid within 10 days, the amount of the purchase discount that would be available to the company is: A) $500 B) $490. $460 D) $540 * 14) A special journal is A) an accounting journal that holds individual accounts that support a specific general ledger account B) a record of accounts that provides supporting details on individual balances, the total of which appears in a general ledger account C) a created list of the accounts used by a business entity to define each class of items for which cash is spent or received. D) an accounting journal designed to record a specific type of transaction. ** 15. What is the maturity value of a 3-month, 10% note for $40,000? A) $40,000 B) $44,000 $41,000 D) $42,000 * lt) Tangent Corporation makes a $1,200 purchase of merchandise inventory on account. This transaction will be recorded in the: A) cash payments joumal. B) sales journal. C) cash receipts journal. D) purchases journal. * 17) A check for which a maker's bank account has inadequate money to pay the check is known as: A) a restrictive check. B) an outstanding check C) a canceled check D) a nonsufficient funds check